Public cloud spending is expected to reach USD 591.80 billion in 2023, making SaaS spend management an essential practice for organizations of all sizes. Unfortunately, SaaS costs can spiral out of control without proper management, leading to overspending and wasted resources. However, with effective SaaS spend management, businesses can optimize their SaaS subscriptions, track usage, and identify opportunities for cost savings.

This blog post will explore the significance of SaaS spend optimization, its benefits, and the tools and strategies to help businesses manage their software spending effectively. Whether you are a newly launched startup or an established enterprise, understanding and implementing SaaS spend management best practices can help you control costs, improve efficiency, and stay ahead of competitors in today's digital age.

What is SaaS spend?

SaaS spend refers to the amount of money a company spends on SaaS subscriptions. These subscriptions can include software for project management, customer relationship management, human resources, and more. SaaS licenses are typically billed monthly or annually, and the cost can vary depending on the number of users and the features included in your chosen membership tier.

Why is SaaS spend management important?

SaaS spend management refers to effectively managing and optimizing the costs associated with SaaS license and usage within an organization. It is essential for several reasons:

  • Cost optimization – SaaS spend management helps organizations optimize costs by identifying redundant or underutilized subscriptions and services. It can help reduce wasteful spending and save money.
  • Budget planning – effective SaaS spend management enables organizations to plan their budgets more accurately by providing insight into how much they spend on licenses and memberships. It helps to ensure that they are allocating their resources effectively.
  • Compliance – SaaS spend management can help organizations ensure that they comply with their vendor contracts and licenses and avoid any potential penalties or legal issues.
  • Visibility and control – SaaS spend management gives organizations visibility and control over their usage. It allows them to manage subscriptions, track usage, and make informed decisions about which services to continue using or cancel.
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Benefits of SaaS spend management

SaaS spend management can benefit companies, especially those that rely heavily on this type of software. Here are some of the top benefits of SaaS spend management, except cost optimization and budgeting:

  • Better decision-making – companies can decide which SaaS applications to use better with improved visibility into their SaaS spending. It can help them choose the most beneficial solutions for their business.
  • Enhanced security – effective SaaS spend management can help improve an organization's security by providing visibility into the software services used and ensuring they meet its security requirements. With SaaS spend management, companies can monitor their software usage and track subscriptions to ensure their alignment with security protocols and guidelines. It can mitigate the risk of unapproved software usage, which may introduce vulnerabilities to the organization's network or data. SaaS spend management tools can also alert companies to potential security threats, such as unapproved applications or unauthorized access attempts. By providing organizations with visibility and control over their SaaS usage, spend management solutions help companies maintain the integrity of their data and protect against potential security breaches.
  • Streamlined processes – SaaS spend management platforms can automate many processes associated with SaaS spending, such as invoice tracking and contract management. It can streamline processes and save time for employees.

Tips and Best Practices for SaaS Spend Management

Here are some tips and best practices that companies can follow to manage their SaaS spend effectively:

Identify the subscriptions

The first step to effective SaaS spend management is to identify your company's subscriptions. It includes subscriptions used by different departments, teams, or individuals within the organization. Once you have a complete list of subscriptions, you can analyze their usage and cost.

Track SaaS usage and spending

Tracking SaaS usage and spending is essential to effective spend management. Companies should regularly review their SaaS service usage and costs to identify potential cost savings opportunities. It may include analyzing usage data to identify services that are not being used or are used inefficiently.

Negotiate subscription renewals

Businesses should consider negotiating with SaaS vendors for better prices when renewing their service agreements. They may offer discounts or other incentives to retain existing or attract new customers. Moreover, companies should regularly review their SaaS services and cancel unnecessary ones to reduce overall costs.

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Invest in employee education

Educating employees is a best practice for effective SaaS spend management. Companies should inform and train their staff about the costs associated with software services and encourage them to use them efficiently. This approach can minimize the risk of overspending on SaaS licenses and ensure that employees utilize the most valuable services to the company.

Centralized SaaS spend management platform

Implementing a centralized SaaS spend management platform can help companies manage their software licenses more efficiently. Such platforms provide visibility into the usage and cost of all licensed software, enabling companies to track their spending and identify potential cost savings opportunities. With these tools, companies can better manage their SaaS licensing expenses and optimize their budgets for greater efficiency and cost-effectiveness.

SaaS Spend management software and tools

Manual management of SaaS spend can be daunting, but thanks to technology, dedicated management software and tools are now available to simplify the process. These solutions help companies monitor and control their SaaS spend in real time, ensuring they get the best value for their money.

Different SaaS spend management software and tools are available in the market, each designed to meet various business needs. For instance, some of them help companies to track their SaaS subscriptions, while others provide cost optimization and analytics capabilities. Here are some of the most popular SaaS spend management software and tools.


It's a leading SaaS management platform, enabling businesses to discover, manage, and optimize their SaaS subscriptions. In addition, the platform provides real-time data on usage and spending, allowing companies to track their software costs and identify opportunities for optimization.


It's a popular SaaS spend management tool that helps businesses to manage their SaaS licenses and reduce spending. The platform provides automated tracking and alerts for unused or underutilized SaaS applications, enabling enterprises to eliminate redundant software licenses and save money.


It's a cloud-based SaaS management platform enabling businesses to manage their entire SaaS lifecycle, from procurement to retirement. The platform provides insights into SaaS usage, spending, and compliance, allowing companies to optimize their SaaS spend and reduce any risks.


It's a leading provider of IT research and advisory services. The company's SaaS spend management solutions provide businesses with the insights and tools needed to manage their SaaS spending effectively. The platform offers a comprehensive view of SaaS usage and spending, enabling companies to optimize their software portfolio and reduce costs.

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A SaaS management platform that helps businesses to manage their subscriptions and optimize their spend. The platform provides real-time data on SaaS usage and spend, enabling companies to track their SaaS costs and identify opportunities for optimization.


It's a cloud-based identity and access management solution that helps businesses to secure their SaaS applications and data. The platform provides single sign-on (SSO) capabilities, enabling users to access multiple SaaS applications with a single login credential. In addition, it simplifies access and helps businesses manage SaaS spend by providing visibility into application usage.


A SaaS management platform helps businesses discover, optimize, and control their SaaS licenses. The platform provides real-time data on SaaS usage and spending, enabling firms to identify redundant or underutilized software and optimize costs. Torii also provides compliance and security features, helping businesses ensure their SaaS services meet industry standards and regulations.

Final Words

Effective SaaS spend management is crucial for businesses to optimize their IT budget and maximize their ROI. To achieve this, conducting a comprehensive SaaS audit is vital to understand the organization's SaaS landscape and usage patterns. It enables businesses to identify areas of inefficiency and opportunities for optimization. Based on the findings, companies can develop a SaaS spend management strategy aligned with their budget and business goals.

The implementation of this strategy can be simplified with the use of SaaS spend management software and tools. By leveraging such technologies, businesses can monitor and control their SaaS spending in real time, identify opportunities for optimization, and achieve significant cost savings.

Effective SaaS spend management can help companies to simplify their operations, improve their bottom line, and stay ahead of the competition. Feel free to approach Apptension for guidance or assistance in developing or optimizing SaaS spend management software or tool to meet your business needs.